Loblaw issues 10-year Notes at 5.22%

Loblaw Companies has announced that it:

has agreed to issue $350 million principal amount of Medium Term Notes, Series 2-B pursuant to its Medium Term Notes, Series 2 program. The notes are to be offered through an agency syndicate led by CIBC World Markets Inc. and RBC Dominion Securities Inc. and are expected to be issued on June 18, 2010. The notes will pay a fixed rate of 5.22% per annum until maturity on June 18, 2020. The notes will be unsecured obligations of the Company and will rank equally with all other unsecured indebtedness of the Company that has not been subordinated. The net proceeds of the offering will be used to pre-fund the Company’s $350 million of indebtedness maturing in January 2011 and for general corporate purposes.

L.PR.A, an Operating Retractible issued in June 2008, closed today at 26.90-96 to yield 4.48% to its 2015-7-30 softMaturity. On an interest-equivalent basis, these shares yield more than 100bp over the notes and have only a five year maturity (there is the potential for earlier calls).

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